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superbcarrot | 5 years ago

Sometimes I get shocked by these numbers and it reminds me how little I know about business. Like if you showed me the wikipedia page for Zapier and asked me give it some value, I would be way off. Or if you pitched the business idea to me, I would tell you do something better with your time.

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djrogers|5 years ago

I’m not surprised that people on a developer focused forum would find little to no value in something that enables automation without programming.

Y’all can probably automate interactions with hundreds of web based services in your sleep, using multiple languages, with unit tests, and a Turing complete ML-based proxy server for high availability.

For the rest of us, Zapier is a little like magic. Granted there are other servothay do the same thing, but none that I’ve found do it as easily and as well as Zapier.

brundolf|5 years ago

The thing is that no-code solutions are nothing new or unique; they're a dime a dozen, and have existed almost as long as microcomputers have. What's not obvious is why Zapier's version is (apparently) a revelation. I'm not saying there is no reason, but that's probably where the GP is coming from.

kinj28|5 years ago

To add to your point - so much amount of software already exists in the world. Tools like zapier enables people to put these different software services in an massive assembly line and kind of use them to get their workflow.

hooande|5 years ago

why wouldn't someone just hire a developer to do this? My understanding is that the market for contractors is oversaturated right now. You could probably pay someone hundreds of dollars to write software that interacts with web services etc if you look hard enough

Like the grandparent comment, it's hard for me to imagine that there are enough people in need of this service to justify a $5B valuation

narrator|5 years ago

>Sometimes I get shocked by these numbers and it reminds me how little I know about business.

This is because you lack the most overlooked and most difficult to teach skill in investing: empathy. Zapier lets non-programmers, the vast majority of the planet, do things that programmers do. Many programmers have poor empathy and thus make bad salespeople and investors. If you can understand how most of the planet thinks and feels though, you can figure out what is going to work and what isn't.

Twitch.tv is something that amazed me that it became so big. I don't really play video games. Who would spend hours watching people play video games? I couldn't understand this phenomenon because I was limiting my exposure to people only inside my own little bubble of reality. I think one can't be a good investor without constantly developing ones empathy because the appeal of various things is difficult to grasp intuitively without a person who would be the customer in mind.

Personally, I think it's important to spend time with people one has nothing in common with to develop this broader empathy and thus be able to pick up on these trends.

anm89|5 years ago

Imagine just blasting out at a person that you've never met and know essentially nothing about, based on a few sentences they wrote regarding startup valuations that "they lack empathy". As in you are willing to assess this other person as being completely devoid of empathy.

That seems fairly insane.

raindropm|5 years ago

Damn, misjudge the potential of some product made someone instantly lack of empathy? or maybe it's just that I can't feel deeply relate to everything, and not because I'm heartless bastard...(We can try to understand, yes)

Also, please don't tell other people that they lack empathy straight in the face, that's plain rude, and hey,...sounds like lack of empathy :p

Sometimes I think the application of that word is way too broad, especially in business setting.

etaioinshrdlu|5 years ago

I don't think my mother or father could figure out Zapier. Yet they can figure out the MS Office suite and Excel to get work done. I think the premise is just wrong, Zapier is just not easy enough for non-programmers still.

This may be where some of the mystery over the product among programmers could lie. It doesn't look like it would actually let non-programmers do what programmers do at all.

felipellrocha|5 years ago

> Twitch.tv is something that amazed me that it became so big. I don't really play video games. Who would spend hours watching people play video games?

Heh. I grew playing games with friends. When I got tired, I'd spend hours just watching them play and having fun hanging out that way. It was no surprise to me they got so big so fast. It really is all about empathy, and I thought this little anecdote would help strengthen your point! :)

nojito|5 years ago

>Twitch.tv is something that amazed me that it became so big.

Monetizing loneliness is how social media companies grow. twitch just has a strangle hold on a specific community that no one else thought of.

slightwinder|5 years ago

> This is because you lack the most overlooked and most difficult to teach skill in investing: empathy.

Everyone is lacking empathy, that is not limited to the profession. Empathy on most parts comes from your own experience and understanding, and everyones horizon of experience is limited.

> Twitch.tv is something that amazed me that it became so big. I don't really play video games. Who would spend hours watching people play video games?

Which is strange, considering how many people watch sports. And most videogames are nothing else, just more focussed on mental skills than physical skills. But the main selling point of twitch is IMHO not people playing games, but the interaction twitch offers alongside this. Twitch in that regard is more like a sportsbar or a local sportsfield, where everyone meets, talks, interacts while some do stuff on the side.

The more buzzling part for me are youtube-videos of people playing stuff, because those are missing the interacting and it's just like watching a very poor movie with low production-value.

> I think one can't be a good investor without constantly developing ones empathy because the appeal of various things is difficult to grasp intuitively without a person who would be the customer in mind.

Yes, it's a given that you need to understand the thinking and problems of customers if you wanna sell them something well. Just throwing stuff at them might work, but more efficient is to understand what they want and what they need, and then build and sell it specifically to the targeted customers.

Similar like in a game you need to understand the abilities and weaknesses of your enemy to slay them. That's why marketing and reasearch exist.

arn|5 years ago

> Who would spend hours watching people play video games

Ask yourself who would spend hours watching people play sports, and it might not seem so foreign.

daniellarusso|5 years ago

Twitch started from Justin.tv, so it was not really about videogames originally.

But, if you think about how professional sports is and could foresee the rise of e-sports...

doopy1|5 years ago

Actually it's because the valuation is insane. They pull like $140MM per year and someone values that at $5B.

user3939382|5 years ago

I've been a programmer for over 20 years and I still use Zapier because I find it relatively quick and easy. Dealing with writing code for authentication, various API versions, debugging, deploying and maintaining the code is all a PITA that I'm happy to avoid where possible.

jaxn|5 years ago

Does Zapier only get revenue from paid subscriptions? Or do companies pay for promotion / integration? I suspect there is a big business around semi-private APIs and gluing "enterprise" partnership deals together.

subpixel|5 years ago

I empathize - in fact I feel the pain. Yet in all my many years of using Zapier I've never paid for the service, and I also would never have guessed the scale of their business.

duxup|5 years ago

" Zapier lets non-programmers, the vast majority of the planet, do things that programmers do"

I doubt that's the reason for the evaluation, that's hardly unique.

jojobas|5 years ago

There was already plenty of middleware tools that allowed API to API translation.

They all (and I assume Zapier is no exception) only allow "no code" integration in only the most basic scenarios.

I don't think it has much to do with empathy, much rather unbounded money printing of late.

xwolfi|5 years ago

Dentists lack empathy: they cant understand how most people think and never explain how they think outside of their bubble.

Our startup, Dentir, makes you do things dentists do :p

toomuchtodo|5 years ago

Khan Academy has an amazing collection of videos on finance. I highly recommend it for understanding cash flows, enterprise value, etc. It's helped me transition (one foot out the door) from tech to finance.

syndacks|5 years ago

Curious to hear why you left one for the other. Not too often you hear that move. How is it going so far?

artemonster|5 years ago

Any other good sources, like books or articles ?

tamrix|5 years ago

Me: I'll sell you 0.0000001% of my company for $1.

You: sure

Me: My company is now worth $10B!

Hackernews: wow that's so amazing! One day in going to be rich doing startups too!

wombatmobile|5 years ago

The $5b valuation is speculative. Only $1.3m has been raised, which is less than 0.02% of that valuation.

anonymouse008|5 years ago

Or you could say $1.3m of a theoretical $5bn demand curve has been tested, at one point.

ErikVandeWater|5 years ago

Why are you assuming the value VCs give it is even close to an honest estimation of its value?

iambateman|5 years ago

Despite the replies, I thought this was a good take.

$5,000,000,000 is a truly unimaginable amount in both senses of the word unimaginable. I couldn’t tell the difference between a $5B and $7B company, for example.

And it’s especially hard to tell for a service which is, somewhat by nature, invisible.

But my smart, non-programmer friends love Zapier and I imagine many of their customer relationships will be multi-decade. There really are so many odd businesses in the world.

beachy|5 years ago

I think of a billion as (very roughly) half of a cruise liner or half of a casino in the strip in Vegas.

Not sure how accurate that is but at $5b, I imagine zapier as a cruise ship tied up alongside a glittering glass casino.

sgpl|5 years ago

I think another thing to keep in mind is that wikipedia pages don't tell the whole story. So you shouldn't feel bad about being way off.

Investors assigning value have access to other metrics not visible to us - customer numbers, growth numbers, revenue and what the revenue growth looks like, internal product roadmaps and other areas of growth, etc.

specialist|5 years ago

Word.

IIRC, Microsoft acquired CompareNet for $400m in 1999. Scripts for scrapping prices. Written in Perl.

I always get stuck on the little questions. Like: Does it work? Is idea worth doing? How big is the market?

(I mention CompareNet because I had some contact with one of the founders. It's my IRL example that I never figured out how to play this game.)

warent|5 years ago

I was shocked by how low the number is! My guess was that Zapier was in the 10s of millions